International Federation of Consulting Engineers Ines Ferguson Chair of the European External Aid Committee - EFCA

FIDIC MDB Harmonised Construction Contract Conference 1. An evolving European External Aid 2. EFCA’s European External Aid Committee this year 3. A look into the future of European External Aid 4. Conclusions 5. EEA Committee main challenges INDEX

FIDIC MDB Harmonised Construction Contract Conference 1. An evolving European External Aid The EU is the world’s leading donor.. with 53.8 billion € in 2010 (EC + MS), representing 50% of all ODA. The European Commission implements 20% of the EU ODA acting as coordinator, convener and policy-maker. Goals of European External Aid:  Reduce poverty through inclusive and sustainable development  Focus on Results  Strengthen partner ownership and mutual accountability  Promote European values - human rights, democracy, rule of law, good governance, gender equality, solidarity, social justice and multilateral action.  Increase Aid Effectiveness and its impact

FIDIC MDB Harmonised Construction Contract Conference 1. An evolving European External Aid.. In a rapidly changing international context: - Graduation: increasing standards of living in emerging economies - New actors in development: private sector, foundations, emerging donors, local authorities, etc. - Population growth: 9.3 billion in Fastest growth in Africa. - “Arab Spring” and the importance of good governance and democracy - Global Crises: financial, food & oil - Strong growth with weak impact in poverty reduction - Economic downturn and budget constraints in EU Member States

FIDIC MDB Harmonised Construction Contract Conference 1. An evolving European External Aid To increase aid effectiveness and “do more with less”: new structure, policies, financial instruments & management modalities Set out in a series of EC communications, statements, declarations and action plans over the past years:  Agenda for Change: increasing the impact of EU Development Policy (2011)  Backbone Strategy: Technical Cooperation Reform (2010)  Lisbon Treaty: European External Action Service – EEAS (2009)  Accra Agenda for Action: Enhanced Division of Labour (2008)  Paris Declaration on Aid Effectiveness (2005) …

FIDIC MDB Harmonised Construction Contract Conference ECSignificant changes Structure DG DEV+DG Europeaid = DG DEVCO to optimise resources EEAS to reinforce decentralisation Policy Increased donor coordination (mainly EU MS) and concentration in countries/sectors (Division of Labour) Instruments Financing: Blending, trust funds, budget support Technical: cooperation agreements, twinning Management Modes Indirect centralised, joint, shared (other donors, incl. MS) Decentralised (partner country) Sectors Multiplier effect: sustainable agriculture & renewable energy Regional integration, trade, infrastructure, environment Regions Neighbourhood countries + Sub-Saharan Africa 1. An evolving European External Aid

FIDIC MDB Harmonised Construction Contract Conference 2. EFCA’s European External Aid Committee this year More visibility to the EC  Meetings with EuropeAid on the main changes to the PRAG;  EFCA Position Papers to EC public consultations:“Assessment of Experts on Service Contracts under EU External Actions” (Jun. 2011) and the “Revised PRAG 2012” (Jun. 2012);  EC-EIC-EFCA Roundtable on EDF Contracts (Mar. 2012); Better understanding of EC reforms affecting our industry  EuropeAid Technical Cooperation Reform presentation during Committee meeting; Policy in addition to Procurement Issues  General Statement on the Industry (under preparation);  Policy Papers on New Financing Instruments & Delegated Management from the companies’ perspective (under preparation).

FIDIC MDB Harmonised Construction Contract Conference 2. EFCA’s European External Aid Committee this year Extended Mandate  To other EU Institutions involved in Development, namely EIB, EBRD, CEB & others of Member States (Jan. 2012) Increased Coordination FIDIC-EFCA  Convey concerns of EU firms in MDB-funded contracts through FIDIC;  Participation of FIDIC’s Managing Director in EEA Committee Meetings;  Joint FIDIC-EFCA visit to EBRD in Feb New mandate for MEDA Countries: Morocco, Tunis, Egypt and Jordan;  Next EEA Committee meeting coinciding with the FIDIC-MDB Conference in Brussels, Jun. 2012

FIDIC MDB Harmonised Construction Contract Conference 3. A look into the future of European External Aid Multiannual Financial Framework More Aid in fewer sectors (concentration: 3 sectors maximum)  Graduation: 17 Upper Middle Income Countries (Argentina, Brazil, Chile, China, Colombia, Costa Rica, Ecuador, Kazakhstan, Iran, Malaysia, Maldives, Mexico, Panama, Peru, Thailand, Venezuela and Uruguay) and 2 large Lower Middle Income Countries (India, Indonesia) will benefit of new partnerships not based on bilateral aid.  Growing use of innovative financing instruments with international financial institutions, the EU funds acting as a catalyst for leveraging investment in infrastructure.

FIDIC MDB Harmonised Construction Contract Conference 3. A look into the future of European External Aid EU External Aid budget : 96.2 billion €  European Development Fund (EDF, outside EU Budget): € 34,276 million  Development Cooperation Instrument (DCI): € 23,295 million  European Neighbourhood Instrument (ENI): € 18,182 million  Pre-accession instrument (IPA): €14,110 million  Instrument for Stability (IfS): € 2,829 million  European Instrument for Democracy & Human Rights (EIDHR): € 1,578 million  Partnership Instrument (PI): € 1,131 million  Instrument for Nuclear Safety Cooperation: € 631 million  Instrument for Greenland: € 219 million

FIDIC MDB Harmonised Construction Contract Conference 3. A look into the future of European External Aid Revised PRAG 2012  Extending the use of global price contracts  Notification of tender evaluation results will be quicker  Documentary proof of prequalifying references to be submitted with the tender  Change of Key Experts: finding a replacement in 15 days  Ensuring the availability of evaluators in the Tender Evaluation Committee A Position Paper on the Revised PRAG 2012 is being prepared in reply to a public consultation (Jun. 2012) New PRAG in line with the new financial regulations will be ready in early 2013.

FIDIC MDB Harmonised Construction Contract Conference 4. Conclusions More Aid with an increasing use of new financing instruments Accelerated Division of Labour – other donors’ procurement systems Concentration - appointment of leading donors per country/sector Increasing use of budget support - use of country procurement systems More actors in development: growing relevance of CSOs and Local Authorities Focus on local capacity building

FIDIC MDB Harmonised Construction Contract Conference 5. EEA Committee’s main challenges  Defending the importance of European consulting engineers’ professional services in EU External Aid projects & programmes: best practice, quality services, budget control, capacity building, contribution to sustainable growth in partner countries.  Increasing our visibility in EU institutions as relevant partners in Development.  Improving contract conditions for Consulting Engineers working in Development, ensuring transparency and equal opportunties in all actions funded or financed with EU External Aid.

FIDIC MDB Harmonised Construction Contract Conference THANK YOU Ines Ferguson Chair of EFCA European External Aid Committee